Bandung- A new study from Telkom University, Bandung, reveals that the Indomaret franchise business model in Sidoarjo Regency, East Java, remains operationally strong but insufficiently adaptive to local market conditions. Conducted by Alif Sulthan Rassya, Putu Nina Madiawati, and Yogi Suprayogi from the Faculty of Economics and Business, the research was published in 2026 in the East Asian Journal of Multidisciplinary Research. The findings matter as Sidoarjo is one of the most competitive modern retail areas in East Java, where minimarkets face pressure from rivals and fast-growing digital commerce.
The study closely examined a regular-format Indomaret franchise located in Porong District, Sidoarjo. While the store operates under a nationally standardized system and benefits from Indomaret’s strong brand reputation, the researchers found a clear gap between the centrally designed business model and daily operational realities at the local level.
Why Indomaret’s local performance matters
Indomaret is Indonesia’s largest minimarket franchise network, known for convenience, fast service, and standardized pricing. Its stores are deeply embedded in daily consumer life, especially for urban and peri-urban communities. In regions like Sidoarjo—an economic buffer zone for Surabaya—modern retail growth has accelerated alongside rising incomes, dense population, and shifting shopping behavior.
However, this rapid expansion has also intensified competition. Indomaret outlets often operate within a short radius of Alfamart, Alfamidi, and emerging quick commerce platforms such as GoMart and GrabMart. At the same time, customers increasingly expect consistent product availability, faster service, and digital ordering options.
According to the researchers, these pressures expose structural weaknesses in franchise-level execution, even when the brand and system remain strong.
How the research was conducted
The research used a qualitative case study approach focused on one Indomaret franchise unit in Sidoarjo. Data were collected through:
- In-depth interviews with the franchise owner, area manager, and senior store staff
- Direct field observations at the store
- Analysis of internal documents, standard operating procedures, and performance reports
To interpret the findings, the researchers applied the Business Model Canvas (BMC) framework, supported by SWOT, IFAS–EFAS, and TOWS matrix analyses. This approach allowed them to map how value is created, delivered, and captured, while identifying gaps between ideal modern retail practices and actual store operations.
Key findings: strong brand, weak local adaptability
The study shows that the Indomaret franchise in Sidoarjo operates with high standardization and strong dependence on head office policies. This brings stability but limits local responsiveness.
Several critical findings stand out:
- Frequent stock shortages occurred in high-demand products such as instant noodles, cigarettes, rice, and bottled water. This directly undermined the promise of convenience.
- Customer relationships remained transactional, with no local customer relationship management (CRM), loyalty tracking, or systematic complaint handling.
- Sales channels were fully offline, and digital platforms like the Klik Indomaret application were not actively used at the store level.
- Operational costs were high, driven by fixed expenses and royalty payments, increasing the need for efficiency and repeat customers.
From a strategic perspective, SWOT analysis placed the franchise in an aggressive growth quadrant. The market environment is favorable, but internal execution limits the ability to fully capture available opportunities.
“The core issue is not market potential,” the authors note, “but the gap between a centrally designed business model and the operational realities faced by franchisees.”
A proposed business model tailored to local needs
To address these challenges, the researchers developed a proposed Business Model Canvas that prioritizes adaptability, customer engagement, and value consistency.
The revised value proposition is built on three pillars:
- Fast – introducing fast-line service zones and WhatsApp-based ordering for quick transactions
- Always available – tighter monitoring of high-demand stock to reduce out-of-stock incidents
- Community-ready – partnering with local food and beverage MSMEs to offer ready-to-eat products
Customer relationships are redesigned to move beyond passive transactions. The proposed model encourages simple, low-cost micro-CRM systems, such as customer groups on WhatsApp and Instagram, combined with improved frontline service culture based on smiling, greeting, and proactive assistance.
The model also diversifies revenue streams through collaborations with local micro and small enterprises, without requiring major store format changes.
Real-world impact for businesses and policymakers
The study estimates that implementing the proposed business model could:
- Reduce lost sales by 2–5 percent
- Increase overall revenue by 7–10 percent
- Improve customer loyalty and repeat visits
For franchise owners, the findings offer a practical roadmap to improve competitiveness without violating brand standards. For franchisors, the study highlights the importance of allowing limited operational flexibility so franchisees can respond to local demand patterns.
From a policy perspective, the research underscores how modern retail can coexist with local economic ecosystems by integrating MSMEs rather than displacing them.
Author insight
According to Alif Sulthan Rassya of Telkom University, strengthening value delivery at the store level is more impactful than price competition alone. He and his co-authors argue that “business model innovation through better value propositions and customer relationships creates more sustainable competitiveness than relying solely on brand power.”
Author profiles
- Alif Sulthan Rassya Telkom University.
- Putu Nina Madiawati Telkom University.
- Yogi Suprayogi Telkom University.
0 Komentar